Scottish Devolution and Article 50

Tommy Sheppard Excerpts

Wednesday 15th March 2017 Westminster Hall

[Deidre Brock]

The hon. Gentleman will be pleased to hear that I will address that later in my speech.

Now we find ourselves about to leave the European Union, the Prime Minister is making the threat of removing competencies from Holyrood as they come back from Brussels; other than that, we do not really have any idea of what she is planning. Leaving the European Union means that the Scotland Act 1998 must be revisited, because it compels Scotland to comply with EU law. The clawing back of powers and competencies from Holyrood to Whitehall, as suggested by the Prime Minister, would also require amendments to that Act.

If Members want to understand exactly how much disentanglement there will be, they should ask the Commons Library, as I did. They will be told that there is a huge number of directives and regulations to look through and that to come up with a definitive figure, list or even idea of what is reserved and what remains devolved is, to all intents and purposes, a fool’s errand.

To give an example, there are 527 regulations under the environment, consumer and health sections alone, and there are a whole host of environmental regulations under other headings such as “energy”. I do not know whether the Scotland Office has been working to draw up a list—or the Wales Office or the Northern Ireland Office for that matter. It would be good to be told, but it is clear that there is an enormous amount of work to be done and an enormous amount of legislation to comb through. Sifting that, considering it, deciding where to lay it and working it out will need a new Scotland Act.

It is true that the Government could use section 30 of the 1998 Act further to reserve powers over those areas currently under EU control, but that would seem frankly perverse if the Act has to be amended in any case. That seems simple, but when I asked the Prime Minister last week whether she would consult the people of Scotland properly and seek the consent of the Scottish Parliament before making changes to the legislation that frames devolution, she seemed perplexed. Her answer to me was that she undertakes

“full discussions with the Scottish Government on…reserved matters and…where we are negotiating on behalf of the whole of the United Kingdom.”—[Official Report, 8 March 2017; Vol. 622, c. 808.]

However, we discovered on Monday that that is simply not true. Scotland’s First Minister was clear that none of the devolved Administrations had heard a peep from the UK Government before the announcement that we are all being dragged out of the single market, in spite of that being the major part of the Scottish Government’s compromise proposal on Brexit.

There is a sweetheart deal for Nissan, but no discussion of Scotland’s needs—far less any movement to accommodate those needs. Membership of the single market is vital for Scotland’s exports, and essential to the exercise of the economic competencies of the Scottish Parliament and to the future of many Scottish businesses. An immigration system that offers EU citizens the right to come to Scotland to live, work, study and settle down is essential to our continuing to grow a population that is economically active and demographically sustainable, as was discussed in the recent Scottish Affairs Committee debate. Academic research and the excellent record of Scotland’s universities is under threat, because Brexit will cut them off from an enormous research funder and from the universities they co-operate with on the continent, not to mention the academics who come to Scotland from elsewhere in the EU.

The implications for Scotland of triggering article 50 are enormous and deep-seated and, whichever way things go, they will have a long half-life. We have heard the glib “Brexit means Brexit”, that it will be red, white and blue and that there will be no running commentary, but I am beginning to suspect that there is no running anything behind Whitehall’s firmly closed doors. It is time that the Government started to lay out what Brexit actually means in terms of implications for the people who live on these islands, rather than continuing use of tautology.

[Tommy Sheppard (Edinburgh East) (SNP)]

My hon. Friend is making an excellent case. Does she agree that those people—the minority—in Scotland who voted to leave the European Union did so hoping that they would see a transfer of powers back from Brussels to Edinburgh and that they will be dismayed that they are getting a transfer of powers from Brussels to Westminster? Does that not do a disservice to those no voters in Scotland as well as disrespecting the entire country, which took a different view?

[Deidre Brock]

My hon. Friend makes an excellent point that I completely agree with. The National Farmers Union of Scotland shares many of his views. It has told me that Brexit is the biggest challenge to Scottish food producers in generations. Farmers, food processing companies and hauliers need migrant workers, access to European markets and guarantees on future financial support. Many of Scotland’s farmers depend on that financial support to remain solvent.

The NFUS is clear that the issue should be in the purview of the Scottish Government, and that the cash should follow that competency. That would be around £600 million a year, or £3.5 billion over the current seven-year cycle. More than 20,000 businesses in Scotland receive common agricultural policy payments, and more than 3,000 of those receive less than £1,000 each; that is subsistence, not luxury. We have no idea what the Government intend to happen—whether the cash will be ponied up for our farmers or what other support is in the pipeline.

We all know that the Government are sick and fed up of having to think about the fate of European citizens here and want it tied to UK citizens abroad—the very definition of bargaining chips. We know that because the Prime Minister keeps telling us. Scotland needs those citizens. Half of Scotland’s population growth in the past 15 years has come from EU citizens, who have come and made a huge contribution to the country. Four fifths of them are of working age, and four fifths of those are employed. They drive Scotland’s economy and contribute taxes, which are of course to be collected for the Scottish Government from April. Scotland cannot hang on and hope that we get something for those people. We need it now because they need it now, so that they can plan ahead rather than planning to leave.

We do not need warm words and vague hopes that a deal can be done, but straightforward action, and now. Scotland needs the UK Government to make the necessary changes now to give EU nationals continuing legal rights—of residence, movement, economic activity and study—that would need legislation to be removed, not a promise to look at it sometime in the future. That is what Scotland needs, what the Scottish economy needs, what Scotland’s public sector workforce needs and what the devolution settlement needs.

If the UK Government want to make a decent fist of Brexit, they have to start being honest. The Prime Minister has to stop telling us that she is consulting with the devolved Administrations when she clearly is not.

Draft Sovereign Grant Act 2011 (Change of Percentage) Order 2017

Tommy Sheppard Excerpts

Thursday 2nd March 2017 General Committees

[Tommy Sheppard (Edinburgh East) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Bone.

We cannot support the statutory instrument, or the taking of this decision at this time and in this way. Let me be clear that my remarks are not a criticism of or challenge to the monarchy or the royal household. Nor is there a suggestion that Buckingham Palace is anything other than an historic asset of the country that needs to be invested in and protected.

What we are concerned about is using a variation to the sovereign grant to fund such a major item of capital expenditure. That goes against the conventions of public financing. In any other sphere we would not conflate revenue and capital expenditure in that way. If a major investment of £400 million in the infrastructure of Buckingham Palace is needed, it seems to me that that should be treated as a separate capital project, and properly budgeted for, rather than being funded out of the sovereign grant, which is meant to fund the revenue expenses—the day-to-day and year-to-year expenses—of the royal household and the maintenance of its duties. The proposal is similar to saying that the works that need to be undertaken to this place should be funded by doubling MPs’ salaries and asking them to make a contribution to the contractor doing the work. That is not, of course, how we would do it.

The hon. Member for Bootle is right to say that we need to be aware of public perceptions. Yesterday there was a demonstration outside Parliament by people with disabilities who are campaigning against an imminent cut of £30 a week in the employment and support allowance, amounting to £1,500 a year. That is a paltry sum set against the figures under discussion, but it could literally mean life or death to the people in receipt of the benefit. I think that the public would find it hard to understand how, when the public finances are in such dire straits that we need to implement such cuts that affect the poorest members of society, there is apparently no problem in simply finding the money to undertake major works at Buckingham Palace.

I suggest that the matter should be debated fully by the entire House and that we should divide on it. It is not something to be relegated to a Committee and dealt with in a matter of minutes on a Thursday morning. I think that many hon. Members on both sides of the House would want to participate and they should have that opportunity.

In conclusion, when the proposal was made to change the civil list to the sovereign grant, I do not think that this is what those who drafted the legislation had in mind. Of course, there could be variations in the percentage of Crown Estate revenue that goes to the sovereign grant, but that should happen only when a predicted or known increase in the revenue budget is required for the funding of the royal household. It should not go towards capital works on a new roof, new wiring or whatever works are needed at Buckingham Palace or any other royal palace. That should be treated separately; otherwise we shall be in a bizarre situation whereby we will have to come back here year after year, depending on what capital works are required to the royal estate, to consider such variations.

That does not seem to me to be a good way to do business, so I am afraid that we cannot support the statutory instrument. We shall seek a Division and we look forward to a debate on the Floor of the House.

--- Later in debate ---

[Tommy Sheppard]

I understand and accept the popularity of Buckingham Palace as a tourist attraction, and as a visitor attraction for people who live in this country. Would it not therefore be reasonable to consider whether the commercial dimension of Buckingham Palace as a venue and an attraction might provide an income stream to fund ongoing capital works to maintain its current quality?

[Simon Kirby]

The hon. Gentleman raises an interesting point. That is exactly what we are deciding today. There will be 115,000 more visitors each year, because there will be increased access. Some 30,000 more children will be able to visit the palace—only 1,500 can currently do so. There will be an additional 110 events every year. This is a long-term solution. The hon. Member for Bootle was right to say that previous Governments of all colours should perhaps have considered this more carefully, but we are where we are and this is a sensible way forward.

Oral Answers to Questions

Tommy Sheppard Excerpts

Tuesday 28th February 2017 Commons Chamber

[Simon Kirby]

I can reassure my hon. Friend that the Treasury is very much in listening mode. We definitely want the best possible deal and we are clear that it is the end result, rather than the mechanism, that is important.

[Tommy Sheppard (Edinburgh East) (SNP)]

17. Whether his Department has made an assessment of the effect of the depreciation of the pound on levels of disposable income.

[The Economic Secretary to the Treasury (Simon Kirby)]

I am pleased to say that the Government are taking action to support the level of real disposable income per head, which is forecast to be 2.8% higher by 2021 than it was in 2016.

[Tommy Sheppard]

There can be few things more tragic than a Treasury in denial. As sure as night follows day, the collapse of the pound will lead to higher prices, particularly for food and household technology, so when will the Minister’s Department get its head out of the sand and bring forward proposals to boost disposable income, to help people to meet these rising costs?

[Simon Kirby]

Average earnings growth has now outstripped inflation for 27 consecutive months, and the Office for Budget Responsibility has forecast that real disposable income will be 2.8% higher in 2021 than it was in 2016.

Concentrix

Tommy Sheppard Excerpts

Wednesday 26th October 2016 Commons Chamber

[Chris Law (Dundee West) (SNP)]

I have spoken a number of times in Parliament on this subject, and every time I speak I listen to the many stories from across the Chamber and elsewhere about individual cases. My constituency is no different in the way that individuals have been affected by Concentrix, which is contracted by HMRC on behalf of this Tory Government As I said in my early-day motion 396, HMRC’s contract with Concentrix is driving families into immediate poverty.

Let me offer the House a few examples. One of my constituents who I spoke with had only part of her address held on the Concentrix system. When background checks were run on the address, a number of people were named as living at the same property. As a result of a needless investigation by Concentrix, this person struggled to feed and clothe her children for over a month. Another lone parent was judged to have made a false claim as a single parent. Following my complaint, it was discovered that an incorrect address had instigated the investigation and, in fact, HMRC owed this constituent a considerable sum of money. Sadly, this was not uncovered before the constituent had to give up her home due to financial hardship. Such cases reinforce the points that have been made in the debate.

[Tommy Sheppard (Edinburgh East) (SNP)]

Does my hon. Friend agree that another aspect of this shambles is the at times near-complete breakdown in communication between Concentrix and HMRC, as exemplified by my constituent Dionne Walker, a mother of three, who supplied Concentrix with every single piece of information it asked for, only to find out subsequently that Concentrix had not passed it on to HMRC? Her tax credit application was cancelled, leaving her having to seek crisis loans and go to food banks to feed her three children for the rest of the week. Does my hon. Friend agree that that is unacceptable, and that people such as Dionne Walker and countless thousands of others are owed an apology by this Government?

[Chris Law]

Indeed. I hope to hear such an apology from the Minister this afternoon. My hon. Friend’s example makes the point that I was about to raise—make no mistake, many of these people are single parents, who are already struggling to make ends meet and are the target of this Government.

Evidence has now emerged that Concentrix, on behalf of this Government, sent out, over a two-year period, almost a million letters asking for information about people’s circumstances, in what can only be described as a fishing expedition to detect potentially irregular tax returns. It is up to the constituent to prove that they are innocent before tax credits are reinstated. In other words, they are treated as guilty until proven innocent. It does not end there. Reports suggest that staff at Concentrix are regularly dealing with suicidal callers who threaten to kill themselves. How desperate does the situation have to get before urgent action is taken and the contract is ended?

The social and health impacts of the Concentrix contract, on both members of the public and employees, are horrific. That has been reinforced in the recent report of the Work and Pensions Committee, which found evidence of humiliation of claimants and appalling customer service, and appeal success rates of between 73% and 95%, described as

“a terrible indictment of the original decision-making process”.

Unsurprisingly, this is not the first time that Government outsourcing has failed to meet expectations. I made the point earlier that these payment-by-results contracts go back to 2003, when Labour introduced them for NHS England. I am sure everyone in this Chamber remembers Atos, whose shambolic and cruel tests were designed to strip away benefits from sick and disabled people.

Under the contract that this Government have with Concentrix, Concentrix is paid on a payment-by-results basis—in short, commission. The more tax credit payments Concentrix puts a stop to, the more money it pockets. Our constituents, who are very often in low-paid, part-time work, find themselves at the rough end of a contract that many of us would never sign up to in jobs in our everyday lives. How different the decisions made by this Government would be if Government Members were put on payment-by-results contracts.

It is hard to believe that this Government continue to cut HMRC jobs in Dundee and right across Scotland, while at the same time privatising and outsourcing contracts. HMRC departments, which are already understaffed, have been left to pick up the pieces and have spent months restoring backlogs of claims and errors. It is time to end this madness.

Although Concentrix certainly has questions to answer, I believe that the disastrous implementation of the Concentrix contract by the Tory Government has implications that go far beyond that specific company. This Government have created a system designed to place the burden of their failing austerity agenda firmly on the shoulders of those most disadvantaged in our society. The contract with Concentrix has not been renewed, which is a step in the right direction, and it looks as though it will shortly be brought to a close, which is good news. However, the Government need to go further.

Alongside the ongoing investigation of the Concentrix contract by the Work and Pensions Committee, an inquiry has been initiated by the National Audit Office. I welcome these developments, albeit at a time when too many of my constituents have already suffered. I urge the Government to set up a public inquiry to examine the conditions under which Government Departments award public contracts to private sector providers. Such an inquiry would offer reassurance to members of the public who are weary of hearing disaster stories from the NHS, HMRC and the Department for Work and Pensions. Among the aspects that I believe deserve particular attention are how to devise contracts that ensure value for money and efficiency without allowing companies to profit by manipulating results and ignoring the well-being of people in our society; a clear statement of ethical principles to emphasise justice for individual citizens and parliamentary accountability; and representation of consumer and service user groups in decision making at all stages of formulating, awarding and monitoring contracts.

In the end, everyone in this House must remember that we are privileged to be here and serve the public. In that spirit, I urge this Government to re-examine all their contracts with private companies and ensure that dignity and respect, rather than profit and price, are at the heart of procurement.

House of Lords Reform and Size of the House of Commons

Tommy Sheppard Excerpts

Wednesday 19th October 2016 Commons Chamber

[Tommy Sheppard (Edinburgh East) (SNP)]

It is a pleasure, as always, to follow the right hon. Member for Surrey Heath (Michael Gove). It is just a shame that he has done a disservice to the House and to himself by refusing to discuss any part of the motion on the Order Paper. Let us consider the predicament into which the political class in this country has now gotten itself. Since the introduction of adult universal suffrage, there has been concern and sometimes embarrassment about the anachronistic nature of our bicameral legislature, in which one completely unelected House has the powers that it has. Over the decades, there have been attempts—many of them successful—to limit those powers and to assert the primacy of this House.

Now, however, we are embarking on a journey on which two things will happen simultaneously. The number of Members in the unelected House will increase to unprecedented levels and without any limit. At the same time, the number of people elected to make laws in this country will be reduced. In my view, that is a serial affront to the democratic values on which this country is based. That could be viewed as simply a matter of constitutional theory, but it is much more important than that. It speaks to the character of our democracy and our country. It lowers the esteem in which we are held abroad and, most importantly, it lowers the esteem in which this legislature is held by its own citizens. I believe that this is one of the contributory factors to the anti-politics, the disillusion and the alienation that have emerged in this country, and unless we do something to counteract this, we are all going to be in a lot of trouble.

As it happens, we do believe in an elected second Chamber, but the case for a bicameral Parliament has to be argued; it cannot just be assumed to be the default position. In fact, 16 of the 28 member states of the European Union have a unicameral Parliament. That is the norm throughout Europe, so we cannot assume that bicameralism is automatically the default.

[Simon Hoare]

The hon. Gentleman makes a strong and telling point about the size of the upper House when compared with the number of elected Members. However, when the official Opposition in this place are in disarray and clearly not up to the job of official scrutiny, the bicameral system means that efficient scrutiny can be done in another place. Does he agree that we should cherish that safeguard?

[Tommy Sheppard]

I want to come on to that. A frequent argument for a revising or upper Chamber is the inadequacy of the first Chamber, and I want to look at some of the imperfections of this House. To start with, we may be elected and accountable, but we can in no way be described as democratically representative of the population who elected us. A system that results in a majority Government with 37% of the vote can never be described as such. Our system is also much more centralised than that of any comparable country. We in Scotland have been on a home rule journey, which we are anxious to speed up, but I actually feel for colleagues in England, who represent the bulk of the United Kingdom, about the absence of any meaningful regional or democratic local government beneath this level. If we actually looked at the matrix of governance underneath this place, we could relieve many of the pressures on this House.

Our procedures for policy review and scrutiny are not fit for purpose. This adversarial system—two sword lengths apart—often militates against a consensual or at least a majoritarian approach to developing public policy, which is why mistakes in this place often have to be rectified somewhere else. However, that is not an argument for the House of Lords; it is an argument for improving the procedures of the House of Commons. The truth is that we need to consider our legislature as a whole and bring in major reforms to both Houses of Parliament. If we do not do that, our system of governance will fall further into disrepute.

[Mr MacNeil]

rose—

[Tommy Sheppard]

I cannot give way because of the time. To say that the House of Lords is justified because it compensates for the inadequacy of the House of Commons is completely wrong. In fact, it exacerbates many of those inadequacies.

Turning to the imperfections of the House of Lords, that it is unelected is taken as given, but it is also profoundly unrepresentative for an appointed chamber. It is old, male and almost half of its Members are domiciled in the south-east of England. In no way does that even attempt to recognise our country. It is also very big—my hon. Friend the Member for Perth and North Perthshire (Pete Wishart) noted that it is second only to the legislature of the People’s Republic of China—and very costly, with each peer costing an average of £120,000 a year and its operation costing almost £100 million. If the Government are serious about reducing the cost of government, I suggest that they look first at what is happening along the corridor.

It is time to begin the process of change. We should be looking at having an elected second Chamber. Indeed, that pledge was in the Conservative manifesto, so it has ceased to be an argument of principle; it is one of priorities and the timing being right. The time is absolutely right to begin the process of considering change and I recommend that this House do so.

[Michael Gove]

rose—

[Tommy Sheppard]

I think I will get into trouble if I give way.

I want to consider the boundary changes, because the two things must be looked at together—they are two sides of the same coin. No case can be made for reducing the number of elected Members of Parliament at a time when this Parliament’s responsibility will increase as a result of leaving the European Union and the repatriation, in whatever form, of a vast amount of powers. At the very least, the pause button should be pressed until the Brexit plan is established and we see how this country manages to survive outside the European Union.

I commend the motion to the House. I am actually pleased with some of the comments from the Government Benches about being prepared to consider it. I point out that the motion does not call for the abolition of the House of Lords or any of the structures of the House of Commons or for electoral reform. It is a motion that says, “When you’re in a hole, stop digging.” It is one that says, “Press the pause button.” Let us look at the plans for the future. Let us pause the reduction in the number of seats in the Commons. Let us pause the escalation in the size of the House of Lords. Let us see whether we can come back with proposals for reform that will command support from across the House and endear us much more to the people who put us here.

Claim of Right for Scotland

Tommy Sheppard Excerpts

Tuesday 6th September 2016 Westminster Hall

[Michael Gove (Surrey Heath) (Con)]

It is a pleasure to serve under your chairmanship today, Mr Bone.

I congratulate the hon. Member for Glasgow North (Patrick Grady) on the lucid, passionate and effective way in which he laid out the case for independence, and on using the constitutional history behind the Claim of Right as a legitimising factor for independence. However, as he was gracious enough to acknowledge, when the Claim of Right was re-established in 1989 by cross-party consensus, the Scottish National party stood aside from that consensus. That was because the SNP position towards our constitution has always been what Henry Ford’s was towards the Model T. Henry Ford said, “You can have your car in any colour you like, as long as it’s black,” and the SNP says, “The Scottish people can decide on any constitutional future they like, provided they choose independence.” So when at that time there was a consensus—I will admit that the Conservatives were outside it—in favour of devolution, the SNP said, “This assertion of popular sovereignty is wrong because it doesn’t agree with me.” In that sense, the SNP was a bit like the proud mother who notices her son marching out of step with everyone else in the regiment and says, “Everybody is out of step, apart from my Willie.”

What the SNP has in consistency, which is admirable, it lacks in honesty about where the true centre of Scottish public opinion lies, and that is in favour of devolution. From 1989 to the present day, there has been support for a Scottish Parliament within the United Kingdom, and when the arithmetic in the constitutional convention did not suit the SNP in 1989, it stood aside, proud in its solitary conventicle. And now, even though it has a majority of representation for Scotland in this House, it regards the fact that a majority of people in Scotland voted against independence in the referendum as a mere temporary interruption and inconvenience.

[Tommy Sheppard (Edinburgh East) (SNP)]

Will the right hon. Gentleman clarify exactly what is being suggested? Is it being said that, because a political party—in this case, the SNP—has a desired and preferential constitutional outcome, somehow its adherence to that negates any genuine commitment to allowing people to choose between a number of options? If that is the case, would it not also apply to the Conservative party or any other political party that has a preferential outcome? Surely the whole point of having a choice is that different parties can put different perspectives before the people and allow them to choose.

[Michael Gove]

I absolutely agree. It is to the credit of the hon. Gentleman and his colleagues that, as I said earlier, they put the case for independence with fluency, with authority, with passion, with commitment. I take nothing away from the power of the case that they make. But the Scottish people have rejected that case: in a referendum, the Scottish people clearly—by 55% to 45%—said no to independence.

But now the SNP is claiming in this debate that the long-held constitutional principle that the Scottish people are sovereign means that the Scottish people should be independent. But either the Scottish people decide their own constitutional fate, in which case we should respect the decision taken in that referendum, or they are perpetually wrong because they do not agree with the SNP. I also point out that since that referendum we have seen the SNP move from being a majority Government in Holyrood to a minority Government, and we have seen that support for Scotland’s position within the Union has remained resolutely at the same level as in the referendum. We have also seen Ruth Davidson, the leader of the Scottish Conservatives, become the single most impressive and popular politician in Scotland. The latest statistics and opinion polling reinforce what everyone knows, which is that she is the single most formidable politician in Scotland. Those are the facts and, as Robert Burns once pointed out, we all know that,

“facts are chiels that winna ding”.

Automatic Registration: UK Elections

Tommy Sheppard Excerpts

Wednesday 29th June 2016 Westminster Hall

[Tommy Sheppard (Edinburgh East) (SNP)]

May I start by remarking on the fact that the Government Benches appear to be particularly denuded this afternoon? I hope that is because Government Members support the proposition under discussion. I ask the Minister to reflect on the fact that, so far, no one has spoken other than to support the principle of automatic voter registration, and that not a single Member of the House is so exercised to the contrary as to turn up—that alone might make him consider that this is an idea whose time has come. I hope that we will get a positive response from him.

I, too, congratulate my hon. Friend the Member for Midlothian (Owen Thompson) on bringing the debate to the Chamber today. I endorse and support pretty much everything he said in moving the motion.

I want to highlight a couple of aspects of the problem, the first of which is its scale. In 2014, the Electoral Commission estimated that as many as 7.5 million people who are entitled to vote might not be on the electoral register. To get some more up-to-date figures in preparation for the debate, I asked the House of Commons Library for a list by constituency of the estimated over-18 adult population compared with the number of people on the register. I have the figures with me, if anyone is interested, and they show that the difference between the number of over-18s in the population and the number on the register is just over 6 million. That is not a direct comparison, because many people on the register will be double-registered. The largest cohort of those will be students, but there will also be people who have moved house and so on, and some over-18s are not entitled to vote anyway.

Those figures indicate that we have a considerable problem, and we have it in all parts of the country. In my constituency, which includes the biggest part of the centre of Edinburgh, with its big transient population, I have 23,000 more over-18 adults than are on the electoral register. That is a staggering number of people. Even in the Minister’s constituency of Weston-super-Mare, the figure is more than 10,000.

That is a problem for three main reasons. First, it is a democratic outrage. We cannot sit here and be content with the situation if our fellow citizens are not even eligible to vote on that scale. As the hon. Member for Mitcham and Morden (Siobhain McDonagh) pointed out, not everyone is treated equally. Those suffering deprivation or oppression of one kind or another are less likely to be on the register than people who have a reasonably comfortable life, are literate and are settled in their situation. The people who face multiple indicators of deprivation are the least likely to be on the register. We have a somewhat ironic situation: the more awful someone’s life is and the more problems they face, the less able they are to do anything about it through the democratic process. We cannot possibly let that lie for much longer.

Secondly, apart from the democratic argument, the situation is an administrative nightmare. That was epitomised by what happened in the run-up to the registration deadline for the European Union referendum. The computer crashed because it could not cope with the demand. Why do we create a situation in which there has to be a rush before a deadline, mostly comprised of people checking whether they are on the register in the first place? It does not have to be done that way. If we had a process of continual automatic registration of the electorate, the problem would not arise.

The other problem, which has been remarked upon, is that a lot of people think they are on the register when they are not. That is one of the contributing factors to a general disillusionment and alienation with our democratic system, which we cannot allow to continue. For all those reasons, I very much support the campaign for automatic voter registration, and I hope the Minister will say something positive today.

The all-party group’s report has been referred to, and it was signed off by a Member from the Minister’s own party, the hon. Member for Norwich North (Chloe Smith). It made 25 recommendations, some of them incredibly sensible. Which of them does the Minister think are good ideas that could be implemented? I have a copy of the report here. The final recommendation is that, because of all that has come before, we should move to a system of automatic voter registration. I think we have to do that.

I want to try to anticipate some of the arguments against automatic voter registration. The first would be, “Perhaps there is a data collection problem, and data that have been collected for one reason cannot be used for another.” Well, the Government should bring forward the legislative changes required to enable that use. Provided that we specify at the point of collection that the information will be used to allow people the right to vote, I do not see any particular problem, and that could be done almost instantaneously given that so many transactions happen online. It could be done within weeks. We do not have to wait years for it to happen.

The second argument that people will probably make is, “The computer systems do not talk to each other. We will have to get a new computer system and that will take a lot of time and cost a lot of money.” Don’t blame the technology—the computer systems do not have to talk to each other. All that is required is that human beings involved in the process of compiling the electoral register can use the other computer systems to put together one that deals with electoral registration.

The third problem to be raised might be, “There may be a concern about people being put on the register against their will. People should have the right to not be registered.” Of course they should, so the Government could automatically register them and write to them saying that that is what has been done. At that point they would have the chance to opt out.

The final problem that is raised is, “Perhaps there is a problem with security. How do we know that the person who paid this bill should be put on the electoral register?” That is a ludicrous argument. If someone applies for and gets a British passport, which is one of the main credentials a person needs to be able to take part in democracy, surely it should automatically follow that they get put on the electoral register as well. If someone buys a new house, it is a legal obligation not only to register the property but to register ownership of the property. Surely we should be able to put that person on the electoral register automatically.

Will the Minister say which of the 25 recommendations in the all-party group’s report can be implemented now and which he would like to look at over a bit more time? Will he come forward with proposals to allow automatic voter registration to happen? Bring us solutions, rather than problems.

Anti-corruption Summit

Tommy Sheppard Excerpts

Tuesday 3rd May 2016 Westminster Hall

[Tommy Sheppard (Edinburgh East) (SNP)]

On behalf of the third party, I congratulate the people whose efforts have secured this timely debate. I also look forward to having debates in the main Chamber next week as we prepare for the summit.

Many people are mesmerised and bewildered when they consider the scale of what is happening and what we are talking about. It is estimated that $2 trillion of tax goes unpaid in the world economy. To put that in perspective, £1 in every £20 in circulation in the world is subject to some form of dubious practice and somebody trying not to do what they should do with it.

As my hon. Friend the Member for Glasgow North (Patrick Grady) stated, in developing countries, the amount of money that goes uncollected and is therefore unavailable to Governments in Africa is greater than the amount of international aid that that continent receives. Here in our own country, the amount of tax that is evaded or avoided by those who should be paying it is estimated to be in excess of £7 billion. If the Government were so minded and were able to collect that money, it would be enough to do away with all the proposed cuts to welfare and social security that we have spent many hours debating over the past couple of years. We really need to get a grip on this.

Something that has concerned me over the past few months is that there are those who will try not to justify what is happening, but to provide a smokescreen for some of it. They suggest that an awful lot of what is going on is perfectly legal, saying, “Ah, well, this is tax avoidance, which is lawful. This is not tax evasion.” A lot of members of the public get very confused about that, so we need to be clear about what is happening. For instance, people might decide to donate to a charity and to use the gift aid regulations to maximise their donations, or they might save for an ISA and get tax benefits out of that. That is not tax avoidance. That is using a legislative procedure for what it was meant to be used for. Tax avoidance is when companies use procedures for things that they were not designed to be used for in order to avoid their liabilities—something that most people in this country never even get the chance to contemplate.

With regard to doing something about the problem, I echo the comments of others. The most important thing is that we need to be able to follow the money and see where it is, so transparency is vital. I welcome the fact that, from next month, we will have a public register of beneficial interests in this country. We will be able to see what companies in this country own in this country. However, large parts of the land in the Scottish highlands are owned by companies that are registered in the Bahamas and elsewhere, so the register will not assist me or anyone else in understanding the transparency of property and land ownership in the areas we represent.

The most important thing in this whole debate is that our dependent territories and overseas areas be compelled in some way to be transparent. After all, as the right hon. Member for Barking (Dame Margaret Hodge) observed, the people that live in those areas are British citizens who also enjoy the protection and all the benefits of the Crown. Therefore, it is inconceivable that a situation can exist whereby the overseas territories and Crown dependencies are allowed to deprive Her Majesty’s Revenue and Customs of monies that it should, rightfully, hope to get. It is vital that action be taken. My question for the Minister, above all others, is: what leverage or sanction will be applied to the Administrations in those areas to ensure that they do not frustrate the objectives that this Parliament has set itself? There have been times in the past when we have not been shy about taking action to compel, and we need to know that those areas will be discussed at the summit.

Many people have talked about this country getting its house in order. I agree that we should not be too complacent about the situation here. There are some aspects that have not yet been mentioned and that we might want to revisit, including HMRC’s arrangements with large multinational companies regarding their tax liability—for example, the deal that was done with Google. If we are talking about transparency, we still need to know the details of that. In the absence of the facts and figures, we have to assume that a deal has been done to allow a very rich multinational company to pay an effective corporation tax rate of 3%. Many people who run businesses in this country will look at that and wonder how it can be that one of the world’s richest companies is charged 3% on its profits in the UK when they are paying many times that rate.

My hon. Friend also observed that we need to consider the general anti-avoidance rules. He is right that the Scottish GAAR has been lauded by many independent commentators as a stricter and more effective set of regulations than exist in the UK as a whole. The irony is that the Scotland Act 2016 will still cover only a minority of taxation and regulation in that country, but the UK Government could learn much from Scotland’s GAAR about toughening up the regulations.

Perhaps the Brexit debate is the elephant in the room. Much has been achieved in recent years at European level, through the EU, on anti-laundering legislation. I accept that, in theory, if we were to leave the EU, it would be possible to make bilateral or multilateral arrangements with other countries to try to do something about tax avoidance, but in the short term, and for an undefined period, the holes in the regulatory net would be widened if Brexit were achieved, so we need to consider the implications. Finally on putting our own house in order, there is still much more to be done on deploying resources and specialists to investigate malpractice, so I would like the Minister to talk about beefing up our capacity.

My final point is on leadership. As others have said, the Prime Minister has done a lot, but there is still more to do. For example, I would like a little more transparency on whether he has had any benefit from his father-in-law’s company that owns large parts of Jura, where the Prime Minister decided to holiday in 2015. More information on that would be welcome.

There has been a distraction in recent months. We debated this subject a couple of months ago, when everyone was having a feeding frenzy to get Ministers and MPs to publish their tax returns. Of course, it became apparent that, if anyone was up to no good, the last place we would find evidence of it is on a tax return. What we really need to know is the information that does not appear on tax returns. As Members of Parliament, we are in a position of trust as legislators. We are the custodians of the arrangements that our citizens have to follow, and we need to be beyond reproach. We need to register our interests in the Register of Members’ Financial Interests, and we need to consider whether Members should register any interests in offshore countries where they may be benefiting from the loopholes that we are trying to close.

The anti-corruption summit offers an opportunity for the Government to demonstrate global leadership. There are many decent people in this country who pay their taxes and who have never thought about doing anything else, and they are looking to the Government to do something about this massive international problem.

Oral Answers to Questions

Tommy Sheppard Excerpts

Tuesday 19th April 2016 Commons Chamber

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

7. What steps he has taken to reduce the number of tax havens worldwide.

[Tommy Sheppard (Edinburgh East) (SNP)]

12. What his policy is on requiring multinational companies to disclose to the public the profits they hold in tax havens (a) in British overseas territories and Crown dependencies and (b) elsewhere.

[The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)]

The Government are leading the world in the fight against tax evasion and it was Britain that first demanded that multinationals publish, country by country, where they pay tax. Thanks to our leadership, that is now being taken up at a European level. Multinationals selling into Europe will be required to report the tax they pay, including in ultra-low tax locations. Britain has also got its leading allies to agree to share information on the beneficial ownership of companies. We are now seeking international leadership on a blacklist of tax havens, with punitive action against the jurisdictions on that blacklist. We want the rest of the world to follow our example; where we lead, others should follow.

--- Later in debate ---

[Mr Osborne]

That is a perfectly reasonable question, and it was well put. A huge amount has changed. There is much tougher regulation of the financial system, and we have better regulators. Banks are more on the case of bad action in their areas, but it is true that more needs to be done to create a proper culture in the banking system in which they treat customers fairly and seek to do the right thing. That is happening, and the banks that do it will get rewards from customers in the marketplace. Like other professions, the industry is seeking to improve its standards of conduct.

[Tommy Sheppard]

The Chancellor will be aware that the reporting requirements for private companies are a lot less stringent than those for publicly listed companies. Although the register of beneficial ownership is an improvement, we need to know not just who owns a particular company but how much tax they are avoiding. If a company gets away with not publishing income, turnover or profit, that will not do. May I ask him what steps he will take with our overseas territories to ensure that this is rectified?

[Mr Osborne]

Of course, all companies have to pay their correct taxes, and we have taken action to ensure that. Country-by-country reporting is designed precisely so that people can see in particular where multinational businesses pay tax.

Bank of England and Financial Services Bill [Lords]

Tommy Sheppard Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 19th April 2016 Commons Chamber

[Harriett Baldwin]

I will get to that point later in my remarks. As always, I seek to be helpful to the hon. Gentleman, so I hope that he will enjoy those remarks when I get to them.

We believe that it is unnecessary to impose the requirement in new clause 2 to have regard to regional representation on the court, which is effectively the board of directors of the Bank of England, because of the comprehensive framework for regional information gathering that already exists. In addition, if we found a candidate with the perfect profile to serve on the court, but we insisted on downgrading them because they lived in an over-represented part of the country, that would not be the best way to produce an effective court.

I have been clear that in setting both monetary and financial stability policy, the Bank must take into account economic conditions in, and the impact of policy decisions on, every part of the UK. Monetary and financial stability policy must be set on a UK-wide basis. None of the 65 million people whom this House represents would be well served if, for example, different capital requirements applied to banks in different parts of the UK. Of course, monetary policy must be consistent. It is completely impossible to set different interest rates in different regions, so monetary and financial stability are, rightly, reserved policy areas.

The men and women who make up the Bank’s policy committees must have their decisions scrutinised, but since policy must be set UK-wide, this Parliament must hold them to account. This Parliament holds power over reserved matters, which these issues rightly are, and the Members of this Parliament represent people from every part of the country on an equal basis. Likewise, Ministers, who are accountable to the House and who hold their positions with the support of a majority of the House of Commons, must be responsible for making the external appointments to the Monetary Policy Committee, each member of which is responsible for considering the impact of their policy decisions on all 65 million people in the UK.

We also return to the question of the Bank’s 300-year-old name. It is important to recognise the reputation associated with a name built up over such a long period. During that time, the Bank has come to be globally renowned as a strong, independent central bank. We should not underestimate the importance of that. International confidence in the Bank of England helps to support international confidence in our economy and currency.

I turn to the monetary framework. The Government amendment in this group is modest. The Bill reduces the minimum frequency of Monetary Policy Committee meetings from monthly to at least eight times in every calendar year, and our amendment adjusts the reporting requirements of the Monetary Policy Committee to match.

[Tommy Sheppard (Edinburgh East) (SNP)]

The Minister moved on very quickly from the matter of the name. I just want to clarify whether the Government have a view on changing the name of the Bank of England to reflect the fact that it is the Bank for all the nations of the United Kingdom. Notwithstanding the fact that in normal, everyday parlance it will, I am sure, still be referred to as the Bank of England, its long and proper title surely should reflect all the nations of the United Kingdom.

[Harriett Baldwin]

I respect and pay tribute to the fact that the Bank of England was founded by someone from Scotland, so the hon. Gentleman is absolutely right to draw attention to the fact that this is an historical anomaly. I would be the first to accept that the monetary policy of the Bank of England is set for the whole United Kingdom. That does not mean to say that we will accept the new clauses that would change the name of the Bank of England, because we think that its name has been well established over 300 years.

--- Later in debate ---

[Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)]

I thought that I would come along to listen this afternoon, but I was stung into action by the Minister’s peroration, in particular her comments on new clauses 2 and 3.

[Tommy Sheppard]

Does my hon. Friend share my sense of regret and bewilderment that the Government can so casually dismiss the proposal to amend the long name of the Bank of England? Does he agree that it is disingenuous of the Conservative Government to talk about a respect agenda that embraces the contributions of all the United Kingdom’s nations when they refuse to recognise those contributions at the first opportunity, and state that only England should be in the name of this most significant institution?

[Roger Mullin]

I agree entirely with my hon. Friend. Indeed, it is particularly apposite that he makes that point now, because as my hon. Friend the Member for East Lothian (George Kerevan) pointed out, the Bank of England is a very different kind of bank from a few short years ago. It has a much more political role than it did, and it makes decisions that have a wider impact than before. Its name surely now needs to reflect the impact of its decision making.

The second reason why my hon. Friend the Member for Edinburgh East (Tommy Sheppard) is entirely correct is because of the changed political climate in the UK. The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) made similar points about the need to recognise the role of Wales. This is important. It is not a flimsy point; it is fundamental for people who want to see an important central institution that has proper regard for all the nations that it seeks to serve. A short while ago, I was looking at a list of the court of directors of the Bank of England. Looking at the representation provided by its 11 members, one would be inclined to rename it “the Bank of the City of London”, because there is little proper representation for the UK’s nations and regions.

I enjoyed the analogy the hon. Member for Carmarthen East and Dinefwr made with cricket. It is not a subject in which I can claim particular expertise. [Interruption.] Or interest? No, I have some interest in it. The hon. Gentleman pointed out that there is the England and Wales Cricket Board. One Mike Denness, born not far from where I was born in Scotland, was the captain of the English cricket team some years ago; again, I am showing my vintage.

We must have proper regard to all the nations represented in the United Kingdom. I was stung by the Minister’s comment that the Bank of England represents the whole of the United Kingdom, the implication being that it had always done so, but I do not think that is at all true, in terms of its policy making. The hon. Member for Bishop Auckland (Helen Goodman) and my hon. Friend the Member for East Lothian made the telling point that the Bank has had undue regard for one part of the UK. Many commentators would say that the interest rate setting policy of the Bank of England pre-2008 paid undue regard to the City of London and surrounding areas, and too little regard to the north of England, the Scottish economy, the Northern Ireland economy and the like.

That leads me nicely on to new clause 2 and why there should be representation for the nations and regions that make up the UK on the Bank of England’s court of directors. A short time ago, I had a quick look on the internet to see who these esteemed figures are, and unless I am proven to be incorrect—or the internet is incorrect—one is also a non-executive director of the Financial Conduct Authority. Such interlocking directorships do not serve economic policy and the financial sector well. Do we have such a tiny pool of appointable people that bodies with such an important relationship to one another have to be represented by the same directors? That is not a sign of strength in our appointing arrangements, but a position of extreme weakness.

Why are these things important? My hon. Friend the Member for East Lothian mentioned a word that has cropped up many times in Committee discussions: he talked about the importance of avoiding group-think. Many studies show it to have been part and parcel of the flawed decision making that contributed to the crash in 2008. If we want to avoid group-think, we need people who are willing to think differently and to ask the critical questions, and we need a chairman willing to seek out those with alternative views. I do not see that happening today.

Some years ago, I was sitting within the confines of a company that was considering a large proposal. A paper was presented, and the chairman quickly went around all the directors asking for their thoughts. Every single person around the table immediately said, “I think this is a really great paper and we should go with its suggestion.” The chairman, being extraordinarily wise, said, “I am extremely uncomfortable that we have an immediate consensus, so I am going to postpone this discussion until our next meeting. I want you to go away and generate some alternative, critical views.” That is the wise course of action; it is about not being sucked into group-think. For all those reasons, new clause 2 deserves the support of all those who do not want to replicate the mistakes of the past.